MB-920 Practice Exam 54 — 20 Questions

Question 1

An organization uses Dynamics 365 Finance. They need to revalue foreign currency bank accounts at month-end and post the unrealized gain or loss. Which process should be run?

Accepted Answer

Foreign currency revaluation. The Foreign currency revaluation process in Dynamics 365 Finance revalues open balances in foreign currencies and posts unrealized gains/losses. Option A is wrong because settlement is for matching payments and invoices. Option B is wrong because the consolidation process is for combining financial statements. Option D is wrong because the general journal is for manual entries.

Answer

Settlement

Answer

Consolidation

Answer

General journal

Question 2

Which THREE capabilities are core to Dynamics 365 Finance?

Accepted Answer

General ledger. General ledger is a core capability of Dynamics 365 Finance because it serves as the central repository for all financial transactions, providing the foundation for financial reporting, account structures, and fiscal period management. It enables organizations to maintain a complete audit trail and comply with accounting standards such as GAAP and IFRS.

Answer

Production control

Answer

Warehouse management

Question 3

A company uses Dynamics 365 Finance and wants to automate the reconciliation of bank transactions with general ledger entries. Which feature should they use?

Accepted Answer

Advanced bank reconciliation. Advanced bank reconciliation in Dynamics 365 Finance automates the matching of bank statement lines with open bank document lines (e.g., checks, deposits) and general ledger entries. It uses matching rules and algorithms to suggest or auto-apply matches, reducing manual effort. This feature is specifically designed for high-volume, automated reconciliation scenarios, unlike the basic Bank reconciliation feature which requires manual matching.

Answer

Electronic reporting

Answer

Bank reconciliation

Answer

Cash and bank management

Question 4

A company uses Dynamics 365 Finance. They need to generate financial statements that comply with international accounting standards. Which configuration should they use?

Accepted Answer

Financial reporting. Financial reporting in Dynamics 365 Finance is the dedicated configuration for creating, managing, and generating financial statements that comply with international accounting standards such as IFRS. It uses the Financial Reporting module (formerly Management Reporter) to produce balance sheets, income statements, and other reports with multi-currency and multi-entity consolidation support, ensuring compliance with regulatory requirements.

Answer

Budgeting

Answer

General ledger

Answer

Tax engine

Question 5

Which TWO of the following are valid billing methods in Dynamics 365 Project Operations? (Choose two.)

Accepted Answer

Time and Material. Time and Material (B) is a valid billing method in Dynamics 365 Project Operations where customers are billed based on actual hours worked and expenses incurred, plus a markup. Fixed Price (C) is also valid, where a single total price is agreed upon for the entire project scope, regardless of actual effort. Both are core billing methods supported in the system for project-based invoicing.

Answer

Flat Fee

Answer

Retainer

Answer

Cost Plus

Question 6

A retail chain uses Dynamics 365 Finance and Operations. They are planning to expand to a new country and need to comply with local tax regulations, including VAT reporting and electronic invoicing. They want to leverage built-in capabilities rather than custom development. What should they configure?

Accepted Answer

Tax engine and Electronic reporting. The Tax engine and Electronic reporting (ER) are the built-in capabilities in Dynamics 365 Finance and Operations designed to handle complex tax regulations like VAT reporting and electronic invoicing. The Tax engine allows configuration of tax codes, rates, and rules for different jurisdictions, while Electronic reporting enables the generation of legally required electronic invoice formats (e.g., XML, EDI) without custom code. This directly addresses the need to comply with local tax regulations in a new country using out-of-the-box features.

Answer

Accounts payable

Answer

General ledger

Answer

Cash and bank management

Question 7

A retail company plans to use Dynamics 365 Commerce for both online and physical store operations. They need to ensure that inventory across all channels is synchronized in near real-time. Which feature should they leverage?

Accepted Answer

Distributed Order Management (DOM). Distributed Order Management (DOM) is the correct feature because it enables near real-time inventory synchronization across online and physical store channels by intelligently routing orders to the optimal fulfillment location based on current stock levels. This ensures that inventory data is consistently updated across all sales channels, preventing overselling and enabling seamless omnichannel operations.

Answer

Loyalty programs

Answer

Product recommendations

Answer

Call center functionality

Question 8

A company uses Dynamics 365 Finance and Operations for financial management. They need to ensure that all vendor invoices are approved before payment. Which module should they use?

Accepted Answer

Accounts payable. The Accounts payable module in Dynamics 365 Finance and Operations is specifically designed to manage vendor invoices, purchase orders, and payment approvals. It includes invoice matching, approval workflows, and payment holds to ensure invoices are validated and approved before payment is processed.

Answer

Accounts receivable

Answer

General ledger

Answer

Budgeting

Question 9

A manufacturing company uses Dynamics 365 Finance and Operations. They need to track the consumption of raw materials in real time during production runs. Which feature should they use?

Accepted Answer

Production orders. Production orders are the correct feature because they are the primary mechanism in Dynamics 365 Finance and Operations for managing and tracking the manufacturing process, including real-time consumption of raw materials through operations such as 'Start', 'Report as finished', and 'Picking list' registrations. This allows for immediate updates to inventory levels and work-in-progress accounting during production runs.

Answer

Warehouse mobile device menu items

Answer

Purchase orders

Answer

Inventory journals

Question 10

A company uses Dynamics 365 Supply Chain Management. They need to optimize production scheduling by considering machine capacity, material availability, and delivery deadlines. Which feature should they use?

Accepted Answer

Finite capacity scheduling. Finite capacity scheduling is the correct feature because it explicitly considers machine capacity, material availability, and delivery deadlines when generating a production schedule. Unlike infinite loading, which assumes unlimited resources, finite capacity scheduling respects the actual workload of each resource and material constraints, ensuring that the schedule is realistic and achievable.

Answer

Master planning

Answer

Gantt chart

Answer

Lean manufacturing

Question 11

Which THREE capabilities are provided by Dynamics 365 Finance? (Select three.)

Accepted Answer

General ledger. The General ledger is the core of Dynamics 365 Finance, providing a centralized chart of accounts, journal entries, and financial reporting. It enables organizations to track all financial transactions and maintain a complete audit trail, which is fundamental to the application's finance capabilities.

Answer

Warehouse management

Answer

Asset management

Question 12

A manufacturing company uses Dynamics 365 Finance. They need to automate the process of reordering raw materials when inventory falls below a predefined level. Which feature should they configure?

Accepted Answer

Safety stock levels. Safety stock levels in Dynamics 365 Finance are used to define a minimum quantity for an item. When inventory falls below this predefined level, the system can automatically generate replenishment orders (e.g., purchase orders or transfer orders) to ensure raw materials are reordered without manual intervention. This directly automates the reordering process based on inventory thresholds.

Answer

ABC classification

Answer

Batch attributes

Answer

Inventory aging reports

Question 13

A company uses Dynamics 365 Finance. They need to create a new fiscal year and close the previous year. Which module should they use?

Accepted Answer

General ledger. The General ledger module is the correct choice because fiscal year creation and year-end closing are core General ledger processes. In Dynamics 365 Finance, the General ledger module contains the fiscal calendar setup and the year-end close process, which transfers balances from the closing fiscal year to the new fiscal year's opening balances.

Answer

Budgeting

Answer

Accounts payable

Answer

Accounts receivable

Question 14

A company uses Dynamics 365 Supply Chain Management. They want to implement vendor collaboration to allow vendors to view purchase orders and confirm delivery dates. Which feature should they enable?

Accepted Answer

Vendor portal. The Vendor portal (also known as the Vendor collaboration workspace) in Dynamics 365 Supply Chain Management enables external vendors to access specific purchase orders, confirm delivery dates, and respond to order changes directly through a secure web interface. This feature is designed specifically for collaborative scenarios where vendors need to view and update order-related information without requiring full system access.

Answer

Vendor invoice automation

Answer

Vendor bidding

Answer

Procurement and sourcing

Question 15

A project manager in a consulting firm uses Dynamics 365 Project Operations. The manager needs to track employee time against specific project tasks and ensure that overtime is approved by the project lead. Which time entry methodology should be used?

Accepted Answer

Use the project time entry and approval workflow.. In Dynamics 365 Project Operations, tracking employee time against specific project tasks with overtime approval requires the project time entry and approval workflow. This methodology allows time entries to be submitted against project tasks, and the workflow can enforce approval rules, such as requiring project lead approval for overtime hours. The other options do not support task-level time tracking with overtime approval.

Answer

Use the absence registration feature.

Answer

Use the resource scheduling board to log time.

Answer

Use the expense report to record time.

Question 16

A company uses Dynamics 365 Finance. They need to generate financial statements that comply with local regulatory requirements. Which feature should they use?

Accepted Answer

Financial reporting. Financial reporting in Dynamics 365 Finance is the dedicated feature for generating financial statements that comply with local regulatory requirements. It provides configurable report definitions, row and column structures, and supports multiple reporting frameworks (e.g., GAAP, IFRS) to meet statutory reporting needs. Unlike transactional modules, Financial reporting is specifically designed to produce balance sheets, income statements, and other regulated reports.

Answer

Accounts payable

Answer

Fixed assets management

Answer

Budgeting

Question 17

An organization uses Dynamics 365 Supply Chain Management. They have a requirement to automatically generate purchase orders when inventory for a specific item falls below a defined level, but only if the item is not already on order. Which method should they use?

Accepted Answer

Configure coverage groups and item coverage settings with a reorder point and Min/Max coverage code. Dynamics 365 Supply Chain Management uses coverage groups and item coverage settings to automate replenishment. By configuring a reorder point with a Min/Max coverage code, the system generates purchase orders when inventory falls below the defined level, but only if the item is not already on order, as the system checks existing open orders before creating new ones.

Answer

Implement the vendor self-service portal for purchase order creation

Answer

Set up vendor collaboration to allow vendors to manage inventory replenishment

Answer

Create a procurement catalog and enable automatic requisition approval

Question 18

A company uses Dynamics 365 Supply Chain Management. They are experiencing inventory discrepancies during physical counts. The discrepancies occur only for items using a specific storage dimension group that includes location and pallet ID. What is the most likely cause?

Accepted Answer

The storage dimension group does not require pallet ID tracking for all transactions. When a storage dimension group includes pallet ID but does not require pallet ID tracking for all transactions, users can skip entering the pallet ID during inventory movements or counts. This leads to discrepancies because the system cannot accurately track inventory at the pallet level, causing mismatches between physical stock and system records.

Answer

The warehouse management parameters are misconfigured

Answer

Items are using batch numbers inconsistently

Answer

The inventory posting setup is incorrect

Question 19

A company uses Dynamics 365 Human Resources (HR) and wants to ensure that new employees are automatically assigned to the correct compensation plan based on their job and department. What must be configured?

Accepted Answer

Define eligibility rules in the compensation plan to automatically assign based on job and department. In Dynamics 365 Human Resources, eligibility rules within a compensation plan define the criteria (such as job and department) that automatically assign employees to the correct plan upon hire. This ensures that the system evaluates the employee's attributes and applies the appropriate compensation structure without manual intervention, leveraging the built-in eligibility engine.

Answer

Implement a hiring workflow that triggers an email to HR to manually assign the compensation plan

Answer

Set up a compensation structure for each position individually

Answer

Configure the employee self-service portal to allow managers to assign compensation plans

Question 20

A company uses Dynamics 365 Supply Chain Management for warehouse management. They notice that picking routes are inefficient, causing delays. They want to optimize picking paths automatically. Which feature should they implement?

Accepted Answer

Wave processing. Wave processing in Dynamics 365 Supply Chain Management automatically groups released orders into waves and optimizes picking routes based on location sequencing and work templates. This reduces travel time and improves warehouse efficiency by generating efficient pick paths without manual intervention.

Answer

Inbound load management

Answer

Cycle counting

Answer

Cluster picking